Senators call for a briefing on bank fraud

By JP LOPEZ

July 26, 2017

The Senate committee on banks, financial institutions and currencies called on the Metrobank, the Anti-Money Laundering Council and the Bangko Sentral ng Pilipinas to brief senators on the internal fraudulent scheme allegedly perpetrated by a senior bank official who allegedly defrauded the country’s second biggest bank some P900 million to P2.5 billion in funds.

But Sen. Francis Escudero, committee chairman, said the Senate panel committee will not yet launch a Senate investigation and will like to see first how the ongoing inquiry being conducted by Metrobank along with the National Bureau of Investigation (NBI) on the fiasco will turn out.

Apart from the full-blown investigation by Metrobank and the NBI, the AMLC, with the supervision of the BSP, will also do its own probe to check Metrobank’s internal controls.

Escudero said the panel will look into the result of the inquiry and from then will decide whether or not it is necessary to conduct a Senate probe or just leave it to the bank and the police authorities.

However, Escudero said he will call the Metrobank officials as well as the AMLC and the BSP in a meeting in order to get acquainted with the developments of the case and determine if there are loopholes in the existing safety banking mechanisms and procedures.

“I want to be enlightened and I want to hear it straight from Metrobank. I want to know how the bank executive was able to commit such a massive scale of fraud even with the bank’s internal control and checks and balances,” Escudero said.

The suspect, Maria Victoria Lopez, was arrested in an entrapment operation conducted by the NBI last July 17. Lopez is the head of the corporate services management division of Metrobank’s head office.

According to NBI, Lopez fabricated documents and facilitated the disbursement of loans into fake accounts under the name of one of their corporate clients, the Gokongwei-led Universal Robina Corp. (URC).

Through the P25-billion credit line of URC, Lopez was able to process loans amounting to P900 million and P850 million.

According to reports, the suspect was able to release the loans “in tranches of P30 million.”

“So what we want to know now is how often the audit happens, from the side of the BSP and the bank itself. How come the bank did not detect what was going on at the early onset?” Escudero asked.

According to Escudero, while he understands that internal problems are inevitable in any industry, he asks banks and other financial institutions to be more cautious and strict when it comes to internal operations.

“We expect banks to immediately detect red flags in their system and immediately resolve internal matters. Apart from ensuring that the culprit will be brought to justice, Metrobank must secure its clients they have a robust internal control framework and that they will rigorously monitor their system,” the senator said.

Column of the Day

‘The Foreign Corrupt Practices Act of 1977 (FCPA) (15 U.S.C. § 78dd-1, et seq.) is a United States federal law known primarily for its main provision: Against bribery of foreign countries’ food management officials.’

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